Sumner: I'm Not Broke

Sumner Redstone has to come up with $800 million in a month. Investors have logically concluded that the most likely way he'll do it is by dumping more of his holdings in Viacom and CBS.

In part because of this (and in part because of the collapse of the ad market), both stocks have plummeted. Sumner's debt convenants are tied to the value of the stocks, so he's gotten himself into what is known on Wall Street as a "death spiral": The more the stocks drop, the more he owes, and the more he owes, the more the stocks drop (in anticipation of his dumping them).

Sumner, not surprisingly, keeps attempting to reassure people that he has no intention of selling any more Viacom or CBS. Unfortunately, the same people recall the many times he reassured people that he fully supported one subordinate or other only to immediately fire them.

National Amusements is the privately held movie-theater chain that acts as a holding company for Redstone's stakes in CBS, Viacom, Midway Games and other assets.

It faces a mid-December deadline to pay down half of its $1.6 billion debt load. The terms of that debt are tied to the value of CBS and Viacom shares.

"I am pleased that talks with National Amusements' banks and noteholders are proceeding in a smooth and constructive manner," Redstone said in a statement. "It is important to understand that the value of NAI's assets well exceeds its debt and NAI has no intention of selling any stock of either Viacom or CBS."

While Redstone's words were meant to be reassuring, sources said they were reminiscent of the multiple times in the past when he's pledged support for executives only to turn around and fire them.

"It is hard to be reassured when the investment community doesn't have access to NAI's loan documents to assess for ourselves the risk of more CBS or Viacom stock being sold," said Laura Martin, an analyst with Soleil-Media Metrics.